George: PSU Defence Minister

A meeting was convened today by Prime Minister Atal Bihari Vajpayee after Ferandes shot off a letter questioning the methodology of disinvestment. It was also attended by Deputy Prime Minister L K Advani and Finance Minister Jaswant Singh.

However, the high-powered group could not resolve the issues and another meeting is likely to be held on Friday to chalk out the options before the Cabinet Committee on Disinvestment meets on Saturday to decide the fate of Bharat Petroleum Corporation Limited and the Hindustan Petroleum Corporation Ltd.

Over this meeting, too, hangs a question mark, since a lot depends on the Friday meeting. Sources said that it could be attended by Petroleum Minister Ram Naik and Disinvestment Minister Arun Shourie.

Shourie was conspicuously left out of today’s meeting where Fernandes is said to have cited examples from other countries where public issues were the preferred divestment route.

Fernandes, who is also the convenor of the NDA, suggested that all options including issuing shares to the public be considered before going headlong into an outright equity sale.

He said that the cash-rich PSUs, which were granted autonomy as navratnas, should be allowed to bid for those that have been put on the disinvestment block. In other words, allowing the Oil and Natural Gas Corporation and the Indian Oil Corporation to participate as in the case of IBP.

However, the Disinvestment Ministry favours the sale of majority shares to the highest bidders giving them the management control while disallowing other PSUs from bidding as this would result in transfer of money and assets from one Government pocket to another.

But Fernandes is questioning this. ‘‘We should examine how far down the road we have reached. Whether disinvestment is proceeding in the right direction or whether any course correction is needed,’’ he told reporters on the sidelines of a seminar later this evening.

Like Fernandes, Naik, too, is opposed to handing over management of the two oil firms to a private firm and has been insisting that they be allowed to float public issue to fund their proposed refinery projects at Bina and Bhatinda. He argues that privatisation of the two firms would jeopardise the refinery projects.

But Fernandes claimed today that there were no differences within the government but said there was a need to examine the progress made so far and see whether it was in the right direction. ‘‘These are questions any concerned political party or political person wants answers to and they need to be answered,’’ he added.